MONTHLY NEWSLETTER Stakeholder Engagements on E-Tolls for the Johannesburg motorists This month’s newsletter contains an article on the challenges were are currently facing with regards to the upgrading and refurbishment of our highways.
The Gauteng Provincial Government implemented and started a roll out of an e-tolling system on Gauteng highways in 2010; this is due to large traffic congestion that the Gauteng roads are faced with. Introducing an e-tolling system was a way of controlling the traffic and encourage motorists to use alternative means of transport. Although the contract was pure project financing; this case study is similar to a PPP contract and I felt it was a good story to tell because of the impact stakeholder engagement have in making a project successful. The Gauteng Freeway Improvement Programme (GFIP) is a contract between the Government and various parties who formed an SPV, through the South African National Roads Agency (SANRAL), an implementing agent to the Government of South Africa.
Implementation of this project has faced opposition from communities at large. This I believe was due to lack of extensive consultations with communities; which indicates that during the stakeholder engagements, communities were not thoroughly consulted or mobilized to understand the benefits of an e tolling to motorists and the country. As a result, motorists protested and are not prepared to pay the stipulated fee tariff, mainly because they do not understand why they have to pay? And what value there is in paying government such a lot of money. According to Olander 2006, a deliberate stakeholder management is able to maximize the value of a project while taking everyone’s concerns and needs into consideration. A deliberate stakeholder management is able to maximize the value of a project while taking everyone’s concerns and needs into consideration (Olander, 2006). In PPP projects, this is carried out by private investors who establish a Special Purpose Company (SPC). This SPC is granted to run a public business, which is specified in a concession agreement. Therefore, they have to handle external stakeholders, otherwise managed by the public client. Among others, those can be the actual users and their representative unions, landowners and neighbors, local communities, affected businesses, statutory bodies, media, the natural environment and its advocates such as environmentalists, as well as the general public opinion.
However, in Gauteng motorists have raised concern that they are not prepared to pay any fee related to e-tolling; retail business owners have complained as they have to raise the prices of their supplies to cater for the high cost of deliveries. This is the story of many people across Gauteng; people do not want e-tolls because it will make them poorer and increase poverty in communities across Gauteng. The question is? How did SANRAL go ahead with this project despite its negative impact? Did they not know this before they started? The answer is that they knew from as early as 2009 that they were facing widespread opposition against e-tolling on Gauteng freeways. SANRAL’s April 2009 documentation indicates that 48% of people would not be willing to pay for e-tolls. Electronic Toll Collection (ETC) and SANRAL both agree that one of the critical success factors for the project as a whole include the high levels of public compliance. ETC in its contract submission states that this opposition expressed in the market research presents a huge communication and market challenge to shift attitudes and behavior of a significantly large group into acceptance, or at least compliance. In fact they go as far as to say that: “Should such a sizable group actively resist compliance, law enforcement will be serious hampered and could become virtually impossible to implement. Sizable active resistance could jeopardize the project as a whole.
Up to so far, e- tolling contract is not yielding expected results as more and more motorists continue to defy the system and not pay their e-tolling fees through the e-tag token. In fact, the reader can click on the link below to see for themselves how strong the community is
in opposition of this state of the art infrastructure that has cost the Government billions of Rands, of which the Government is indebted to the investors and financiers who interest is to collect revenue from the user fees so as to cover their costs and make a profit. https://youtu.be/AHcVvTLKvTI
www.sanral.co.za @itrafficgp @SANRAL_etoll www.timeslive.co.za Managing external stakeholder relationships in PPP Projects‌‌. http://publications.lib.chalmers.se/records/fulltext/172756/172756.pdf